Category: Plan design

Challenge

Primary care remains underutilized in most self-funded plans. Employees and dependents continue to go to specialists and ER for services which can be more cost effectively treated under primary care setting. Meanwhile due to lack of “significant” demand, primary care physicians are seeing more patients, spending less time with each one and increase their income by frequently using lab testing and imaging. These unnecessary ER visits and tests end up eating a big bite of the plan budget.

Opportunity

This challenge provides an opportunity to the employer to re-define primary care benefit based on predictable costs and specific outcomes. A design where easily accessible, low-intensity longitudinal care is provided by primary physicians in a lower cost, high-value primary care setting.

Model

This benefit can be delivered in a “carve out” model by direct partnership between employer & PCMH (patient-centered medical home) or “included” in the broader plan contracted with an ACO or an integrated health system.

Services

Most most employees, the primary care can make up 80-90% of healthcare. The primary care must include preventive care as well as routine visits. Depending upon the capabilities of the partner network, you may choose to include chronic care as well.

For any service that lands outside of that should be closely overseen by the designated primary care physician.

Plan Design

For primary care, VBID (value-based insurance design) can be an innovative solution to maximizing health outcomes with available health care budget. The basic premise of VBID is to align consumer incentives and payment strategies with value by reducing barriers to high-value health services.

For example, you can choose to reward members for selecting PCP at enrollment and reduce or eliminate copays for office visits, annual physical exam, physical examinations, gyn visits, mammograms, cancer screening, smoking cessation, weight management etc. This will redirect care to the primary care setting to help you eliminate inefficient and unhealthy healthcare system access downstream.

Any additional costs for such incentives can be balanced by raising co-pays and/or co-insurance for using “unnecessary” ER visits.

Payment Model

Services in this model should be paid for through subscriptions. Employees should enroll in the medical home, and physicians should be paid a risk-adjusted amount per enrolled member per month. The risk adjusted score can be based on a mutually agreed methodology for determine low, moderate and high risk members.

Low Risk: Healthy members with very limited need of care.

Moderate Risk: Members with one or more chronic condition.

High Risk: Members with multiple chronic illnesses, and who are accessing healthcare regularly.

Provider Incentives

To better align physicians, you may choose to add incentives (based on health outcomes and other metrics) on top of the subscription costs.

Plan Metrics

Since the goals of the new model is to improve general health, redirect care to primary care setting, manage chronic conditions and manage referrals, metrics should include-

Reduction in PMPM costs for specialist, ER and Outpatient care.

Reduction in overall claim costs.

Improvement in health outcomes based on conditions managed in care plans. For example, how average drop in HbA1C levels for all members enrolled in diabetes intervention programs.

Number of referrals managed.

Member engagement in their care plans.

# of same day/next day appointments.

HEDIS metrics for primary care

Talk to us about how our health insurance solution can reduce costs, improve health outcomes and provide you better visibility & control over your health benefits.

Health plan administration can be a significant drain on your HR and administrative staff. If the in-house staff is burdened with administrative tasks, it can’t make progress on strategic initiatives. That’s one of the reason why the outsourced plan administration is on the rise in mid-large sized companies all over the country. The other reasons include more specialized expertise around compliance, access to benefits administration technology and desire to reduce costs and liability risk.

Traditionally such outsourcing was limited to middle and back-office functions such as member intake, open enrollment, SPD, claims processing etc., recently the role of vendor is evolving into complete benefit administration including direct interactions for all things benefits, with employees and family. This strategy can be risky without proper planning. The more hands-off and distant the in-house benefits staff is, the more difficult it will be for them to effectively intervene and control when some things don’t work.

Here is a list of some of the practices that may help HR obtain more value from their outsourcing relationships in health plan administration:

Focus on Employee experience

No matter how great the time or monetary savings you can achieve with an outsourced provider, the employee experience should be the first thing that you should focus especially when the provider is going to engage with employees in personalized two-way communications.

This requires that the provider should try to integrate into your corporate culture. Their team and systems should be flexible to adapt to your culture and your employee’s expectations.

Document your processes

Many times, new providers are lost because they don’t know your processes. It is important to document your “As is” and ‘To be” processes. This documentation should spell out what activities should happen at each stage of the benefit process lifecycle, as well as the escalation process, when there are issues. You should share any updates made to this documentation with relevant partners.

Define Objectives Clearly

Each outsourced relationship in benefit administration should have well defined quantitative and qualitative metrics. If cost savings is the goal for a certain partnership, how would you measure it? Do you have the baseline numbers to start?

If you are expecting qualitative benefits such as improved response times and increased employee job satisfaction, how will you be able to demonstrate value?

Get Consensus from key management

All key members of management should be aligned with the goals and objectives. Internal issues should be resolved prior to engaging a provider. Otherwise there is a significant risk if provider getting caught in the middle, which may lead to delays as well as the risk to the overall project.

Create accountability

Without a clear sense of accountability, the space between HR and the outsourced provider could grow to a level where no one seems accountable.

Most employees still need a personal touch, guidance from someone with their best interests in mind, someone within their own organization. The HR should make an internal person “accountable” for each outsourced front-office function, to step in, when an issue is escalated until it is resolved.

Create Service Level Agreement

Well-written service level agreements (SLAs) will enable you to measure the value from outsourcing. The SLA’s should include language on the escalation process. The SLA should also include metrics and the need for the provider to provide supporting data for the metrics.

Strive for a mutually beneficial relationship

No business can last without making profit. Getting a high discount may get you a “low cost” provider, but it may also lead to poor service. Give the provider enough room to invest in long term goals including skill development and IP creation. Their return on such investments will eventually help your organization as well.

Communicate Openly

Openly share information with the providers. Set up systems to track issues and the path to resolution. Regular sharing of information between both parties can prevent the occasional and short term issues from becoming larger problems.

Use Technology

The time to rely on papers or email for plan administration related activities is over. All activities related to benefit plan elections, QLE, eligibiity audits, summary documents, clinical and claims data should be in a centralized repository. The enrollment information should pass from employees to providers as well as clinical/claim data back from providers to employees.

Talk to us about how our health insurance solution can reduce costs, improve health outcomes and provide you better visibility & control over your health benefits.

The promise of value-based care is to deliver the best outcomes at a lower cost. Providers are incentivized to keep members healthy by proactively managing the health needs of the members, delivering high quality care while reducing the use of unnecessary tests and treatment.

Self-funded employers have a lot to gain from this model in higher quality, better experience and outcomes and reduced costs. However, it requires a shift in their thinking from the way benefits are designed and delivered today.

We think the effective implementation of value-based care for self-funded employers would require at least three considerations-

Value-Based Plan Design

Value-Based Network Design

Value-Based Care Delivery

Value-Based Plan Design

Unlike traditional plan design approaches, value-based plan design should be focused creating member experiences which encourage them to utilize high value services that produce better outcomes.

It is important to carefully deliberate the implications of such design to ensure you have the systems and resources necessary to fully implement the design and your design fits within the culture of your organization.

Benefit administrators should also be cautious about how they communicate the value proposition of this model, if not done well, it may look like a restrictive narrow network.

They can integrate financial incentives such as lower premiums, lower copay, cash or gift cards, and focus on communicating the value proposition such as unique experience, plan of care, coordinated care etc. to encourage employees to use the system to achieve the desired results.

Value-Based Network Design

Employers can explore value-based care products through a health plan or a direct contract with a health system in an area where they have a large geographic footprint.. Either way, while designing networks, have an open discussion about how the providers can leverage what they’re already doing to deliver an improved experience for the employees.

While there are several models which they can use for contracting, one possible model is risk adjusted monthly rate per member for primary care, FFS with reference pricing for urgent care and severity adjusted episodic rate for scheduled inpatient care.

Each model should include adjustment for quality. Instead of using all CMS quality measures, the plan administrators can choose to focus on the measures that are important for their organization. For instance, if surgeries make up a big part of your costs, you may want to pay higher to providers who have lower surgical complication rates because their outcomes are better.

Providers engaged in value-based care are likely to have a lot of data about your employees, you should seek assurance from them about their data security policies, procedures as well as reports on third party audits.

Value-Based Care Design

Value-based care design requires that providers provide both longitudinal, relationship based care management, and short-term, goal-oriented care management. By applying risk stratification, providers should identify members, their concerns and the level of care needed for each cohort.

In value-based care, the providers should be utilizing multiple channels (text, emails, portal, home visits, group visits etc.) and include chronic care management, behavioral health, self-management and medical management.

Care coordination services are important components of value-based care delivery. Providers may want to reduce the cost of care by steering members to their internal network, but it should not be done at the expense of member’s experience. The care coordination design should improve the transitions of care where the physicians are working more closely with hospitals and emergency departments, as well as with high volume specialty service providers.

Employers should ask for better data sharing on clinical, operational, financial data as well as reporting on quality measures such as HEDIS. Other metrics impacting employee experience such as same-day appointments, doctor follow-ups, plan adherence, care plan per member, health performance against goals etc. should be checked against claim data to get a real-time insight into care delivery.

Value-based care holds a great promise for employers. It is designed around the specific needs of your employees who benefit from a team that coordinates their care, and technology that connects them and their providers with information to help get the right care — it is also going to reduce the costs for you.

Talk to us about how our health insurance solution can reduce costs, improve health outcomes and provide you better visibility & control over your health benefits.